SUPPORTLINE by FONG MIN YUAN

The Star Malaysia - StarBiz - - News -

AEMULUS Hold­ings Bhd is mount­ing a chal­lenge to the re­sis­tance at the 50-day sim­ple mov­ing av­er­age at 45.5 sen in an at­tempt to move out of con­sol­i­da­tion. The stock broke out of the short-term de­scend­ing trend line on April 10 when its share price spiked nearly 20% to an in­tra-day high of 43.5 sen. The counter con­tin­ued to push higher but found it­self los­ing pos­i­tive mo­men­tum to take on a side­ways trad­ing pat­tern by the end of the pre­vi­ous trad­ing week. Given the sharp gains seen over the week, this could have been a tem­po­rary breather be­fore the rally re­sumed. The share price at­tempted to push for­ward on Mon­day but found it­self trapped by the 50-day SMA, which pre­vented it from mov­ing higher on the price chart. Re­flect­ing the share price move­ment, the tech­ni­cal in­di­ca­tors were mixed and grav­i­tat­ing lower to­wards neu­tral ground, al­though there re­mained ev­i­dence of pos­i­tive mo­men­tum. This may be a brief halt to the up­trend and in­vestors can adopt a wait-and-see ap­proach to see if there is a pick-up in buy­ing in­ter­est. The slow-sto­chas­tic mo­men­tum in­dex, fell under the over­bought line at 77 points and looked to de­scend fur­ther in an at­tempt neu­tralise. The 14-day rel­a­tive strength in­dex, how­ever, dipped into neu­tral ter­ri­tory but halted its de­scent and moved in a hor­i­zon­tal di­rec­tion at 66 points. Mean­while, the daily mov­ing av­er­age con­ver­gence/di­ver­gence line main­tained its push to­wards the zero line, dis­tanc­ing it­self from the trig­ger line. Given that there are signs of life in the in­di­ca­tors, there is an op­por­tu­nity for the stock to move past the im­me­di­ate re­sis­tance, which would give the bulls plenty of graz­ing room be­fore it hits the next re­sis­tance at 54 sen, which meets the 100-day SMA. If the stock con­sol­i­dates fur­ther, it will find im­me­di­ate sup­port at the 42 sen mark al­though a pull­back will bring to a stronger sup­port level in the form of the short-term 14- and 21-day SMAs at the 39 sen mark. The com­ments above do not rep­re­sent a rec­om­men­da­tion to buy or sell. Note: This ar­ti­cle first ap­peared in Star­Biz Premium yes­ter­day.

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